The oil boom payoff for Texas
In a preview of priorities for the next legislative session, state lawmakers at a hearing on Tuesday examined the ways the oil boom is changing life in Texas.The legislature would be wise to treat this is a windfall to be used for one time expenditures and not factor it into items requiring annual appropriations. While I think the boom has the potential to last for several years, it is smart to invest the income from it in infrastructure with a long life. That would mean addressing water resources and transportation.
Since the legislature last convened in 2013, budget officials have reported an unexpectedly large windfall from taxes on the petroleum industry, filling state coffers with a multi-billion dollar opportunity to address issues like the water shortage, transportation gridlock and troubled public schools. But industry practices have also wrecked roads, strained infrastructure, vexed police departments, drained water resources, polluted the air and set off knotty disputes among landowners, royalty claimants and oil companies.
Above all, the oil boom has emerged as a singular force driving the state’s great challenge of the 21st century, the post-urbanization population surge.
The industry now employs more than 400,000 people in the state, at an average salary of $120,000 according figures presented at the hearing by the Texas Oil & Gas Association.
“These are good jobs,” said James LeBas, an economist and lobbyist for the trade group.
In addition to more than $48 billion in salaries and wages, LeBas told the committee, the industry pays $11 billion a year in royalties to 570,000 families statewide, an average of $20,000 per family. The Rainy Day Fund, a state account financed by industry taxes to support major emergency initiatives, is on track to reach $12 billion.